CEC Bank focuses on mortgage lending and reports ‘above-target’ H1 profit

Romanian state-owned CEC Bank reports “above target” net profit of RON 208 mln (EUR 42.4 mln) in H1, 13% higher compared to the same period last year.

Its assets rose by 7.7% year-to-date to RON 44.4 bln (over EUR 9.0 bln).

This results in an annualized return on assets of 0.94%, which is smaller compared to the banking system’s ROA for the first half of last year (1.03%) and the first quarter of this year (1.33%) - latest data available for comparison.

The 7.7% YTD expansion in terms of assets is, however, nearly triple the 2.8% average of the whole banking system.

In the first half of the year, CEC issued RON 5.5 bln (EUR 1.1 bln) of new loans, resulting in a total loan portfolio of RON 24.4 bln (EUR 4.96 bln) at the end of the period. No annual comparison was provided for immediate comparison.

However, the bank reveals that the mortgage loan portfolio rose by 17.5% YTD, while the consumer loans portfolio edged up more modestly by 2% YTD and the corporate loans portfolio by 5.3% YTD.

Despite its slower advance of the corporate loans, more than half of the increase in the total portfolio of loans [during H1] was generated by the Government-backed scheme IMM Invest.

As regards the quality of the loan portfolio, CEC bank reported that the non-performing loans (NPL) ratio improved from 5.52% at the end of last year (when the banking system’s average was 3.38%) to 5.38% at the end of June.

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